2011 Midwest Regional Panama Canal Conference Shifting International Trade Routes — Examining The Impact Of The Panama Canal Expansion On The Midwest Region – May 11-12

ITTS was invited to speak at the Midwest Regional Panama Canal Conference in Paducah Kentucky.  The meeting was held in the Carson Center, which is a beautiful facility overlooking the Ohio River.  (While the crest had passed downstream, the Ohio River was still very high!)

For those who attended the evening reception, the Keynote address by Mike Marshall, Alternate Federal Co-Chair, Delta Regional Authority,  stressed his belief that the Panama Canal will be a game changer for the economies of the Delta Region, providing new opportunities and markets in the region.

What did I learn?

  • The region is interested developing into a regional crossroads, with a focus on the nexus of the rivers and rail networks from Paducah to Lexington.
  • While aviation is anchored in the State through the airports in Louisville and Cincinnati (actually in Hebron,KY) flows through the rest of  the state still provide critical services.
  • Kentucky is very dependent upon manufacturing, which ranked as the largest employer in the State.  It was echoed that transportation networks were critical to supporting the shipments from the State.
  • Secretary Hancock, Kentucky Transportation Cabinet, outlined the challenges poised by the flooding of the Ohio River and its tributaries on the State of Kentucky.
  • Kentucky is very interested in developing multimodal solutions to its transportation system, although trucking remains the dominate mode of transportation in the State, but new regulatory pressures could change the trucking climate (costs).
  • Mrs. Lauren Brand, Marad, did a great job on her presentation.  She challenged the audience to think about how to develop market studies that would utilize the region’s assets to promote future growth.
  • Secretary Hancock discussed how increased trade with the Canal will probably pass over I-65, and the plan is to finish widening it across the Commonwealth.  This also includes finishing the I-69 Corridor.  The Cabinet is also doing other scoping studies, but the Commonwealth also has to look at adding value to the transportation networks that use or pass through the region.
  • The Paducah Area Chamber of Commerce is planning a trip to the Panama next April as a followup for this meeting.

What did I do?

  • I participated in a panel with Mr. Rodolfo Sabonge, Vice President of Market Research and Analysis, Panama Canal Authority, and Mr. Dale Lewis, Director of Strategic Analysis, CSX Transportation.
  • Mr. Sabonge spoke first, providing a very through overview of the Canal.  One thing I learned was the PCA does a monthly video update on the expansion.  There is a great multimdia page on the Panama Canal site with live cameras, videos and other information.  (There is also a good video about the Canal developed by PBS.)
  • Mr. Lewis did a great presentation regarding models regarding the indifference line between the various ship configurations and transportation costs.  In both presentations, Kentucky was right in the indifference line between different configurations, but both of the discussions focused on the costs to the region from Eastern ports – not Gulf coast ports.
  • My presentation is posted here.  I focused more on the role of exports in Kentucky (and the broader region) and the importance of looking at developing state partnerships to support infrastructure and economic growth.

What does it mean for the ITTS Region?

  • I think Greg Pritchett, Chair, KY Water Transportation Advisory Board and Chair, KY Association of Riverports, got it right:  the coastal ports are competing with each other, but it is up to Kentucky businesses to utilize its own multimodal networks to provide the necessary services to support Kentucky businesses.

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